Electronic underwriting: insurers testing the waters

By Alain Thériault | July 08 2016 07:00AM

When it comes to electronic underwriting, life insurers are not on an even footing. Yet they are all actively trying to establish their positioning.

iA Financial Group’s CEO Yvon Charest does agree that technology has become indispensable in distribution. “Technology will change relations between advisors and the insurance company. It’s inevitable,” he told The Insurance and Investment Journal on the sidelines of the insurer’s annual meeting in Quebec City on May 5. “We want to help our distribution networks use technology as a sales and prospecting tool.”

Just before press time, Manulife announced on its site for advisors that it plans to launch a new online insurance form that simplifies the application process. It will eventually replace the ez-app, which lets advisors submit online applications for term insurance (Family and Business) and critical illness (Lifecheque). The electronic application will still be used for insurance applications for Manulife Quick Issue Term.

Advisors can also submit a short or full electronic application. Special telephone interviews are no longer required for the full version. Applications in progress are saved, and their access is shared securely. Clients can sign them online, in person or by email.

Guy Couture, regional vice-president, head of Individual Insurance Sales, Retail, at Manulife says that this application is being developed, and that the insurer has only just begun to talk about it internally. “Eventually, we will replace the ez-app, an electronic application completed on the computer and transmitted, by a fully online application,” he says. He declined to give more details but said that announcements are imminent.

“All of these steps are part of our project to modernize our new business processes so that we can issue policies faster,” Couture says. “Right now, we can price policies in 35 days on average. We want to shorten this timeframe in 2016.” He mentions that by dropping biometric analyses, they trimmed the average to two weeks for some insured.

Launched one year ago, Quick Issue Term is sold on an online platform that lets Manulife issue the policy within 48 hours, Couture says. “In addition, the advisor does not have to deliver the policy. It is sent directly to the client, who signed the application online electronically,” he explains.

Biometric analyses and HIV are also facets of the modernization trend. “The Vitality project is also part of this initiative,” Couture continues. Manulife plans to deliver this solution this fall.

Smaller insurers have carved out a niche in electronic applications. Assumption Life has offered them for years to make streamlined products accessible to independent advisors.

In April, the New Brunswick-based mutual insurer implemented the electronic signature on its Lia system. The electronic signature is now available on tablets, smart phones and computers. The sales process is now paperless for all life and critical illness insurance products, for coverage of up to $4 million. There are no signatures or delivery receipts, the company says.

Empire Life has offered the online application Fast & Full since 2013 and launched a new version in 2015. In May 2016, the insurer added PayPal, which allows clients to pay online using a debit card.

Foresters introduced an electronic application in 2015. Canada Protection Plan, which distributes in-house products insured by Foresters, has achieved strong results with Simplified Preferred Term Insurance, a new addition to its No Medical product line. It includes an electronic application.

Michael Aziz, senior vice-president, sales at CPP told The Insurance and Investment Journal that Canada Protection Plan has made electronic applications available to advisors since May 30. The official launch will take place at the end of June.

“All our products are available: permanent and term. The new application will accept electronic signatures,” Aziz points out. Advisors can use the applications on computer, tablet and several models of smart phone, in the client’s presence or for remote sales, he adds.

The application evolves as clients answer health questions. Suggestions are made as the selection steps are completed. Advisors may be prompted to offer clients products with higher health requirements, depending on their health status.

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